What is the purpose of sales forecasting?

The purpose of sales forecasting is to estimate future sales based on historical data. This process involves analyzing past sales trends, market conditions, and various external factors to predict how much product or service will be sold in the upcoming period. Successful sales forecasts help businesses in planning their inventory, managing resources, setting sales targets, and making strategic decisions regarding marketing and promotions. By relying on quantitative methods, market analysis, and other relevant data, businesses can create more accurate and informed projections of their future sales, enabling them to allocate resources efficiently and optimize their operations.

The other options focus on different aspects of business strategy, such as product development, performance evaluation, and product range expansion, but none relate directly to the primary function of sales forecasting, which is to provide an estimate of future sales based on past performance.